allAfrica.com: Nigeria: Competition As Tool for Quality Service Delivery (Page 1 of 2)

In this report, Efem Nkanga and James Emejo, examine the impact further competition will have in the nation's telecoms sector and the need for telecoms operators to put the interest of subscribers above profits if they must retain them as more operators come in to increase competition in the sector

The major preoccupation of businesses the world over is to succeed - knowing that for such business to thrive and make an impact, they have to put the customer and consumer of their products and services at the heart of their operations. Therein lies the analogy of the customer being regarded as 'King'

However in Nigeria's telecoms space, many will argue that the customer has not been made a king but a servant begging for the crumbs that fall from the masters table especially in the area of service delivery. This is not just restricted to the telecoms sector alone but it cuts across all the sectors of the economy. From power, oil and gas, banking and financial services, government ministries to mention but a few.

The customer has many tales of woe to tell. It is common for the Nigerian consumer to pay and not get value for money. It is also common for the consumer to be left at the mercy of the authorities without getting value for money. A recent example that comes to mind is the recent disaster that motorists in Lagos had to face when they purchased contaminated fuel that damaged their cars and made them spend money in trying to fix it without recourse to any kind of compensation whatsoever. This is sad, especially given the fact that in other developed countries authorities have perfected the art of consumer satisfaction, knowing that it's the key that keeps businesses going. In Nigeria, the reverse is mostly the case and business organisations seem to be grappling with that fact and seem not to understand or accept the fact that they have to put the customer or consumer of their services at the centre of their operations. Indeed they should put "satisfying the customer at all times as the mission statement of their organisations."

This is one of the reasons why the recent addition of two more telecom operators who seem to be aggressive and determined to upset the apple cart and engender quality service delivery is a welcome development. The fact is that the emergence of Visafone and Etisalat is coming in at a time when Nigerian subscribers were almost getting fed up with the poor quality of service delivery of the already established operators in the telecoms arena.

The entrance of these two new players is a welcome development because the competition that their entrance will enable will oil the dormant engine of other operators and wake them up from their slumber. Indeed, the Chairman Senate Committee on Communications, Chief Sylvester Anyanwu, said this much when he stated at the unveiling of Visafone that the nation needs more operators to challenge the status quo and bring tariffs down - an obvious allusion to Visafones offer of N1,600 for a line and handset - the lowest in the country today.

Anyanwu who lamented that Nigerian subscribers were not getting value for their money, expressed the belief that the entrance of more operators into the nation's telecoms space is good for the country. He expressed the resolve of the Senate to support the entrance of more operators into the telecoms sector in order to crash tariffs and improve service quality. His optimism is not surprising, because it is an accepted fact that competition encourages enterprise, efficiency, and widens choice. The consumer ultimately emerges as the greatest beneficiary of any competitive scenario because the operators on ground who wants to stay in business and had hitherto been taking the consumer for granted. But suddenly the operators realises that the consumer with more choice can move to another service provider at will and is no longer tied to their apron. We have all witnessed the efficacy of this.

Once upon a time in the nation's telecoms space, the Nigerian Telecommunications Limited, NITEL used to hold sway and was the lord and master of telecoms services, offering such a poor service delivery that Nigerians used to queue for hours to make a single call while those who had the privilege of owning phones at their homes used to procure ladders and cables for Nitel technicians in order to get a tone. The liberalisation of the telecoms sector that ushered in GSM services has ensured that gone are those days when Nigerians were at the mercy of Nitel. The ailing national entity up till now has not been able to recover and has been rendered irrelevant, fumbling and stumbling on, with no consumer to terrorise as in the days of yore.

The GSM revolution at the beginning ushered in quality service offered by MTN and Celtel, then known as Econet at pricey rates with subscribers paying an arm and a leg to procure services. But the competition brought in by Globacom brought about a revolution in the areas of affordability of sim cards with Globacom helping to deregulate and reduce pricing in the sector by massively reducing the prices of Sim cards and slashing tariffs from N50 to about N30 per minute. The icing on the cake then was the commencement of per second billing by Globacom. It was a move that really heralded the beginning of competition in the Nigerian telecoms market. It made the other operators realise that if they don't wake up and introduce the same offers and even add more value added services, they could lose their subscribers to the other competing network.

Nigeria is set to once again witness, such an audacious move as players like Visafone and Etisalat gear up to change the status quo and force operators to reduce their tariffs. Today, it is still believed that Nigerians are paying too high for mobile calls - be it within or outside the networks. Therefore, one of the areas, which would determine success for future players, is the ability to dare to slash further, the current pricing regime. A good example that readily comes to mind is the situation in Ugandan telecoms sector where the likes of Celtel Uganda, MTN-Uganda, Uganda Telecom and now Warid Telecom have revolutionised the industry, giving subscribers a whole lot of options. In Uganda, it was

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